When Is a Purchaser of Art the Victim of Fraud?
As reported in a recent article published in the October 27, 2009 edition of the New York Law Journal, Judge Bransten of the New York Supreme Court dismissed a lawsuit by a purchaser of a painting by contemporary artist Julian Schnabel entitled "Chinkzee." The plaintiff claimed that, among other things, she was defrauded to the tune of $290,000, or the amount the plaintiff allegedly paid for the work.
Judge Bransten apparently found that the plaintiff failed to exercise a requisite degree of "ordinary intelligence" in determining the value of the work prior to forking over the $290,000, leaving the plaintiff with unavailing claims of fraud.
The decision raises important questions for those who believe that they have been defrauded in the purchase or sale of art, to wit: under what circumstances can a purchaser recover if they believe they have been deceived? As always, it depends on the facts of the case but Judge Bransten's decision indicates that, at a minimum, a purchaser of art should always attempt to obtain an independent appraisal of the value of the works to be purchased before forking over the funds. This may particularly true where the purchaser is engaged in some capacity in the art world, making it more difficult for the future litigant to claim he or she could not have reasonably discovered the true value of the works.
More information about the decision can be found here: www.law.com/jsp/article.jsp
